Kaiko, a blockchain and crypto market analytical platform, offers deeper insights into the movement of the platform. Coinbase went to its peak in mid-2023, and since early 2022 by the incident of Terra Luna collapse, the exchange’s take rate has fallen to its lowest point.
The platform’s trading has increased subscriptions and services revenue and the business remains at the heart. The transaction revenue has experienced a decline in retail activity. An early insight into Coinbase’s financial reputation is presented by its market data. On the 13th of February, the platform will report its Q4 earnings.
A Decline in Staking and Retail Trading Unleashed by Kaiko
Coinbase’s Q4 performance holds a key indicator, that is, its Ethereum staking activity. The Kaiko’s monitoring tool is utilized to observe that the fourth quarter of Ethereum’s Beacon Chain will experience a drop.
After Lido, Coinbase is the second-largest ETH staking platform, now experiencing a staking market share decline. Over the past six months, it has observed a decline of 3.8%, netting an outflow of 1.29M ETH. This observation reveals the struggle of revenue from blockchain rewards, besides the support by higher ETH and SOl prices.
Moreover, the high-fee-generated retail traders have not experienced a comeback in remarkable numbers. The investor’s Coinbase trading share has decreased to 18% which is a significant decline from 40% in 2021. The competition is getting stronger with the offerings of fee discounts by several exchanges.
Evolving and Competitive Landscape with Regulatory Challenges
In the U.S., Coinbase is one of the most liquid exchanges, the market maker benefits from its fee structure. There is a slowdown in new listings because of high competition and regulatory uncertainty. A sharp decline is revealed in actively traded pairs by Kaiko, it is on both Binance.US and Coinbase after mid-2023 lawsuits.
The momentum in Coinbase will get a boost again if the regulatory framework is enhanced. The platform will then expand its listing while attracting more potential retail traders.
Coinbase’s Q4 trade volume reaches a two-year high. Post-elections market rallies may affect the platform’s productivity, getting benefits. The challenges are imposed by the decline in retail trading and staking activity. In the crypto landscape, the earnings of the platform are considered a closely watched event.
